The True Cost of Fake Email Addresses for SaaS Companies
· SaaS · 4 min read
Discover how fake or invalid email addresses distort metrics, degrade data quality, and create hidden operational costs for SaaS companies.
Fake or invalid email addresses may seem like a small issue, but they create real and measurable costs for SaaS companies. Beyond wasted outreach and inflated user counts, they can distort analytics, decrease email deliverability, and introduce operational inefficiencies across the funnel.
How Invalid Emails Affect Customer Acquisition
Most SaaS teams invest significant resources to attract trial signups—through paid advertising, content, partnerships, or outbound efforts. But many signups include invalid, unsafe, or disposable email addresses.
Industry reports on email quality indicate that approximately 7–12% of collected emails may be invalid, undeliverable, or risky at the point of capture. While this varies by sector, list hygiene, and signup friction, even a small percentage of bad emails affects acquisition efficiency.
If you evaluate CAC based on total signups—including fake or unreachable users—your calculated cost per acquisition can appear artificially low while actual conversion performance suffers.
For example:
- If 10% of your signups are invalid or disposable,
- And you acquire 1,000 signups per month,
- You may be allocating budget toward users who will never activate, receive onboarding emails, or convert.
This doesn’t necessarily represent direct dollar loss—it’s distorted data, which is often more damaging than wasted spend.
The Quiet Infrastructure Cost
Every new signup triggers a series of automated systems:
- Welcome or onboarding email sends
- CRM or marketing automation entries
- Database writes and user metadata storage
- Authentication records
- Analytics tracking events
These are typically low cost per user, but they accumulate at scale—especially when invalid signups never progress past account creation.
For products with usage-based trial costs (e.g., AI, compute, API credit, storage-based SaaS), fake or repeat signups can also consume resources intended for legitimate evaluation. The scale of this depends entirely on the business model, but the risk is real: trial abuse is one of the most common reasons SaaS teams begin monitoring email quality more closely.
Analytics Distortion: The Hidden Cost
The most meaningful impact of fake or invalid emails is not operational—it’s analytical.
Bad data can:
- Lower apparent activation and conversion rates
- Skew attribution models
- Influence product roadmap decisions based on the wrong cohorts
- Undermine A/B tests that rely on clean user segments
- Lead teams to misinterpret channel performance
If 5–10% of your signups can never receive onboarding emails or engage with your product, your funnel metrics may appear weaker than they actually are.
Cleaner data leads to better decisions, and the reverse is equally true.
Free Trial Abuse
Disposable emails can be used to repeatedly access free trials or gated features. Some large platforms block disposable domains specifically to limit this behavior. For SaaS companies offering generous trials or usage credits, this can result in:
- Repeated consumption of trial-only resources
- Increased onboarding email sends
- More noise within product usage analytics
- Difficulty assessing true trial-to-paid behavior
Again, the extent of this cost varies by product type and how resource-intensive the trial environment is.
Real-World Impact on SaaS Metrics
While there is no industry-wide figure for fake trial signups in SaaS, several independent reports show that a measurable share of collected emails—typically in the high single-digit percentage range—may be undeliverable, invalid, or from disposable email providers.
The concrete consequences include:
- Reduced email deliverability due to bounces
- Lower conversion rates from unreachable users
- Inflated signup counts that complicate forecasting
- Distorted retention and cohort analysis
- Increased workload on support and operations teams
These effects compound over time, especially in data-driven organizations.
The Solution: Verify at Signup
Email verification at the point of signup is a straightforward way to maintain data integrity.
Services like getemailverifier.com can identify:
- Disposable or temporary email domains
- Invalid or unreachable email addresses
- Syntax errors and misconfigurations
- Nonexistent domains or mail servers
- Role-based addresses when relevant to block
By preventing low-quality signups before they enter your systems, you reduce future friction across analytics, deliverability, onboarding, and support.
Estimate the Impact on Your Funnel
A simple model can help you understand potential impact:
- Monthly signups: ______
- Percentage of invalid or disposable emails (start with 5–10%): ______
- Number of affected signups: #1 × #2
- Estimated operational cost per signup (emails + storage + operations): ______
- Monthly impact: (#3 × #4)
This doesn’t include the strategic cost of distorted analytics, which is harder to quantify but often more significant.
Taking Action
Improving email quality at signup leads to:
- More reliable conversion data
- Cleaner cohort and retention analysis
- More accurate A/B tests
- Better attribution insights
- Higher email deliverability
- Reduced trial misuse
- More efficient onboarding
The companies operating with the strongest unit economics aren’t just optimizing their funnels—they’re ensuring the data feeding those decisions is trustworthy.
Start by auditing your signups. How many invalid or disposable emails enter your system each month? How does this affect your deliverability, onboarding, or analytics?
A small improvement in data integrity can create meaningful downstream value.
About Email Verification
getemailverifier.com provides real-time email validation to help SaaS companies maintain clean signup data, improve deliverability, and reduce operational inefficiencies caused by invalid or disposable email addresses.
